Bitcoin Tops $35,000 for Fresh Record as Wild Swings Resume; Saudi Arabia’s Surprise Supply Cut Ripples Through Oil Markets

Jan 6, 2021

$22,851/$300,000 (7.6%)
Sharad Kumar and James Toes

Lead Stories

Bitcoin Tops $35,000 for Fresh Record as Wild Swings Resume
Dave Liedtka and Eric Lam – Bloomberg
Bitcoin jumped to another all-time high on Wednesday as extreme swings continued to buffet the world’s largest cryptocurrency.
The famously volatile digital coin advanced as much as 6% to $35,842, surpassing the previous high set Jan. 3, and was trading at $35,105 as of 11:04 a.m. in New York. It had plunged as much as 17% on Monday. Bitcoin quadrupled in 2020.
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Saudi Arabia’s Surprise Supply Cut Ripples Through Oil Markets
Andres Guerra Luz and Alex Longley – Bloomberg
Saudi Arabia shocked investors on Tuesday with a decision to slice crude output in February and March as part of an OPEC+ supply agreement. The optimism around tightening global supply permeated through the oil market, pushing benchmark crude futures to the highest levels in months and causing swings in calendar spreads and options. While spreads rallied and options turned less bearish, technical indicators warned crude’s rally may be overdone. Here are four charts showing how the supply declaration from the world’s key crude producers, including Saudi Arabia and Russia, rippled across the deepest corners of the oil market.
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Hedge funds end 2020 with lopsided oil position
John Kemp – Reuters
Hedge funds ended 2020 with the most bullish position in oil for 11 months, anticipating coronavirus vaccines would allow consumption to return to normal by the end of 2021.
Along with other money managers, hedge funds had amassed a net long position of 741 million barrels in the six most important petroleum futures and options contracts by Dec. 29.
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Exchanges and Clearing

OCC Monthly Volume by Exchange – December 2020

Intercontinental Exchange Reports December, Fourth Quarter and Full Year 2020 Statistics
Energy Open Interest +7% y/y; 2020 Futures & Options ADV +6% y/y including Energy +15% y/y
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of mortgage technology, data and listings services, today reported December, fourth quarter and full year 2020 trading volume and related revenue statistics, which can be viewed on the company’s investor relations website at https://ir.theice.com/ir-resources/supplemental-information in the Monthly Statistics Tracking spreadsheet.
/bit.ly/3pX6Oiu

Regulation & Enforcement

The UK’s ban on crypto derivatives is set to go into effect on Wednesday
Ryan Weeks – The Block
A ban on the sale of crypto derivatives and exchange-traded notes (ETNs) is set to come into force in the U.K. on Wednesday, January 6. Announced by the Financial Conduct Authority in October after a long and heated period of consultation, the ban forbids the sale, marketing and distribution of CFDs, options, futures and ETNs that reference cryptocurrencies to retail investors. The regulator reckons it will prevent in the region of GBP53m in harm, but industry commentators have raised concerns that it will instead drive consumers onto unregulated exchanges or indeed offshore — and, thus, beyond the FCA’s reach.
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Events

2020 annual trends in futures and options trading
FIA
This webinar will highlight the main trends in trading activity in 2020 in the global exchange-traded derivatives markets, with category and regional breakdowns as well as exchange and contract rankings.
Date/Time: Wednesday, 27 January 2021 | 10:30 a.m. – 11:30 a.m. ET
/bit.ly/3pkdkPI

Miscellaneous

SEC Should Demand More Hedge Fund Disclosure
Michelle Leder – Bloomberg
One of the things that makes American capital markets so attractive is the amount of information available to even casual investors. On a typical day, hundreds of companies file documents with the Securities and Exchange Commission, which pledges that one of its core goals is to “inform and protect investors.”
Yet late on a summer Friday afternoon, the SEC surprised many observers by seeking to slash the number of companies required to file a form that many market participants and journalists have come to rely on: the 13F. It’s a bad move that highlights a challenge for the agency’s next leader.
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